Murphy says gas-tax increase necessary

David McCumber

Published 8:57 pm, Thursday, June 26, 2014

WASHINGTON -- "This town,'' said Sen. Chris Murphy, "has its head in the sand.''

No, the Connecticut Democrat is not a big fan of business as usual in Washington.

For the past 21 years, business as usual has meant not increasing the federal tax on gasoline. And so, as of next month, the Federal Highway Trust Fund will officially be insolvent.

"This is not a joke,'' Murphy said. "The shovels will stop.''

So Murphy and Republican Sen. Bob Corker of Tennessee have proposed raising the gasoline tax -- and they're not messing around. It's a big enough increase -- successive 6-cents-a-gallon increases for the next two years, and then indexing the tax to inflation going forward -- to actually get something done.

And it's big enough to provoke outrage from anti-spending outfits like the Club for Growth, which calls the plan "a $164 billion tax increase, plain and simple.''

So why would a senator from Connecticut, which already has some of the nation's highest gas prices and a lot of residents who sit in bumper-to-bumper traffic and watch their fuel gauges head south, make a proposal that's bound to cause some pain to his home-state drivers?

"I would flip that around,'' Murphy responded with some vehemence. "Because people in Connecticut are spending huge amounts of time stuck in traffic, they know more than anybody how important transportation funding is.''

He added, "Connecticut has fared very well from federal transportation funding. For every cent we send to the feds, we get 1.6 cents back. With other taxes, Connecticut clearly is a net donor state. But not with transportation taxes. The clear net effect to Connecticut of higher gas taxes is positive.''

One reason is that because of Connecticut's size and location, much of the transportation infrastructure crosses state lines, making it inherently federal in scope.

"Look,'' Murphy said, "over the next 10 years it will cost $50 billion to maintain the Northeast rail corridor in good repair. Just to maintain it, not to improve it.

"If that is not done, Connecticut will just die economically. More than virtually any other state in the nation, Connecticut needs investment in transportation. As the arteries clog more and more, it becomes a greater part of the economic story.

"If Bridgeport could reduce the time it takes to get to New York City on the train by 10 minutes, it would utterly transform Bridgeport's economy. Bridgeport's economic future is tied to moving people more quickly down the rail line.''

His and Corker's proposal, Murphy said, will actually provide some funds to improve, not just to maintain current systems.

But there's a reason the gas tax has stayed at 18.5 cents a gallon since 1993. Many people in Murphy's position view proposing any kind of new revenue as political suicide.

Murphy waved a hand dismissively. "Most of what ails this place is connected to a lack of political courage,'' he responded. "A lot of people here are scared of their own shadow. They never want to take a tough vote, much less start a tough conversation.''

For the past half-dozen years, instead of starting the tax-increase conversation, the federal government has simply borrowed from its general fund to make up the transportation shortfall.

"And that's why my kids are going to be billions of dollars in debt to China,'' Murphy said. "It's easier to tell constituents you can build new roads and bridges without paying for it. It's probably a winning political strategy to say that you can get whatever you want without paying. But it's a lie. And for decades, the system has been built on an enormous lie.

"There are legitimate disputes in other areas of the government about whether we need to raise revenues or cut spending,'' he said. "But not with transportation. Everybody agrees we need to spend money there.

"We've got $18 billion to fund a $36 billion transportation budget. So should we find an honest way to deal with that or just keep borrowing the money from China?''

Murphy said there was no "tricky revenue gimmick'' to solve the problem. "The best answer,'' he said, "is to continue to rely on user fees. The best way is to assess those who use the roads.''

In order to make the increase more palatable in Congress, Murphy and Corker would "offset'' the revenue increase by restoring some $190 billon in targeted tax breaks that expired last year -- including a tax incentive for research and development and another for placing lands into conservation trusts.

Asked to explain this, Murphy said, "Well, in the first place I believe in the R&D credit and the land trust credit. But also, many Republicans in Congress have made a ridiculous pledge to Grover Norquist (of Americans for Tax Reform) that they will never vote for a bill that raises taxes.

"Now I think that's an abdication of their Constitutional responsibility to follow the wishes of their constituents, not those of a lobbyist in Washington, but still, this was an attempt to make it clear that this doesn't represent a net increase, so those folks could vote for it.''

Corker said he "had some conversations'' with Norquist's group about the proposal, but after the announcement, ATR made it clear it was not endorsing the proposal. Still, it did not expressly say it would be viewed as a violation of lawmakers' anti-tax pledges if they vote for it.

Murphy also stressed the job-creating benefit of the plan. "We know in Connecticut that between a third and a fourth of our construction work force is still without employment,'' he said. "We need to get those people off the sidelines and back to work, not take jobs away.''

About 600,000 workers would be idled if federal highway funding is interrupted.

How does it look for the proposal?

"We have succeeded in our goal to start a serious conversation,'' Murphy said. "Privately, many of my colleagues admit that we have to raise taxes or fees somewhere. Somebody needed to break the ice and start this conversation, and it fell to me to do that.''